Good news in'92

By Steve Johnson Executive Director Home Center Institute ter, last

OR those who believe the less said about 1991 business the betthere's good news for '92. Late summer retailers began saying business was looking better. The Home Center Institute's economic forecast bears out their reports.

We expect the retail home improvement business to recover from the 1990-91 recession than other segments of the economy. Following a flat 1991, we forecast real sales increases (adjusted for inflation) of 3Vo (real dollars) through 1995. This compares to forecasts of 1.97o real annual growth for all U.S. retailing through 1995.

Growth in the retail home improvement industry is slowing from its boom years of double digit increases. We see little net increase in the number of store units coming into the market, although turmoil among home centers will continue with some opening new stores and others pulling back.

Slowing rates of sales growth and stagnant unit growth are classic characteristics of a maturing retail industry.

They also describe a fiercely competitive market in which the best managed companies survive and prosper.

The industry is adjusting to a market-share battle, where growth comes less from an expandin{ market than from taking business from competitors. The do-it-yourself ,consumer market, which drove home improvement sales for the better part of the 1970s and 1980s, is changing, too.

A study published this year by the Russell R. Mueller Retail Hardware Research Foundation fowd that 78Vo of U.S. households are already involved in do-it-yourself projects. While the rate of participation is not expected to increase substantially, the